1. Presented by: Craig Gibons, Executive Director, Tax Supervising & Conservation Commission OGFOA Spring Conference 2016 Tuesday March 8, 10:30

2. 2 Tax Supervising and Conservation Commission http://www.tsccmultco.com/ Craig Gibons craig.gibons@Multco.us

3. 3 Today’s Proposed Agenda 10:30Welcome, Introductions, & Agenda Setting 10:45Preliminary Building Blocks4-9 11:00Proposed Budget16-39 10:20Approved Budget40-54 11:40Adopted Budget66-64 11:50Discussion

4. 4 What do we do? Monitor 41 taxing jurisdictions for budget law conformance Assist any jurisdiction with budget law conformance

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6. 6 Other Functions Ptax Ballot Measure Hearings Annual Report (300 pages of local government budgets, debt, and Ptaxes) Publish Weekly Update on local government financial issues. Send me an email to subscribe: craig.gibons@multco.us

7. 7 294.338 Compliance with Local Budget Law required prior to expenditure or tax certification (1) A municipal corporation may not expend money or certify to the assessor an ad valorem tax rate or estimated amount of ad valorem taxes to be imposed in any year unless the municipal corporation has complied with ORS 294.305 (Sections constituting Local Budget Law) to 294.565 (Failure to file copy of required budget, reports or other documents).

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9. Appointed by Governing Body (unless…) Prepares or supervises preparation of budget Acts at direction of Executive Officer or Governing Body 294.331 9

10. Not required by statute but highly recommended. See Handout 1 10

11. Governing body and equal number of appointed electors Serve staggered three year terms All have equal authority Must have majority of total membership to hold a meeting Action requires majority vote of total membership 294.414 See also 150-294.414 & 426 11

12. Board Priorities Three-Year Long Range Financial Plan See Handout 2 Five Year Capital Projects Plan Vehicle and Equipment Replacement Plan 12

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14. Budget numbers are good faith effort estimates Resources must equal Requirements (Each fund has to balance) Negative resource amounts are not allowed 14

15. Matches numbers from respective year’s audit or CAFR Adopted budget as modified by supplemental budgets or budget transfer resolutions The Proposed Budget as prepared by the Budget Officer for presentation to the Budget Committee 2013-14 Actual 2014-15 Actual 2015-16 Revised Budget Line Item 2016-17 Budget FTE ProposedApprovedAdopted $$$$$$Wages 10$$$$ The Proposed Budget Budget Detail Sheets 15

16. The Proposed Budget The Proposed Budget Budget Detail Sheets 13-14 Actual 14-15 Actual 2015-16 Line Item 2016-17 Budget Rev. Bud Estimated Expenditures FTE ProposedAppAdopt $$$$$$$$$+Wages 10$$$$ Alternative 16

17. 2013-14 Actual 2014-15 Actual 2015-16 Est. Expend. Line Item 2016-17 Budget FTE ProposedApprovedAdopted $$$$$$Wages 10$$$$ 17 ORS 294.358(1) “…the estimated expenditures for the current year….”

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19. Beginning Fund Balance + Resources - Requirements = Ending Fund Balance = Next Year’s Beginning Fund Balance 294.398 19

20. Cash on hand on day budget is prepared + Estimated revenue for duration of fiscal year - Estimated expenditures for duration of fiscal year = Current Year Ending Fund Balance = Next year’s Beginning Fund Balance 20

21. Rate-Based Levy Or Dollar Amount Levy? Rate-BasedDollar Amount $X.XXXX $XXX,XXX Permanent Levies GO Bond Levies Local Option Levies Optional Method for: Permanent Levies Local Option Levies 21

22. Calculating Taxes to be Levied Example: Total Requirements $ 60,000 Less Existing Resources - $ 10,000 Equals Taxes Needed= $ 50,000 Taxes Needed $ 50,000 Collection % /.950 Taxes Imposed = $ 53,000 Measure 5 Loss (Zero for GO Bond Levies) + $ 1,000 Equals Tax Levy= $ 54,000 Levy to Approve, Adopt & Certify: $ 54,000 The Proposed Budget Dollar Amount Tax Levies 22

23.  Property Taxes (current year)  Prior Year Property Taxes  Fees, Licenses, Fines  Enterprise Revenue  Federal / State / Local Revenue  Grants  Interest on Investments  Bond or other Debt Proceeds  Sale of Assets ORS 294.361 The Proposed Budget Step 3: Estimate Rest of Resources 23

24. Resources = Requirements Resources Are: Beginning Fund Balance + Revenues + Transfers In = Resources Requirements Are: Expenditures + Transfers Out + Ending Fund Balance = Requirements 24

25. The Proposed Budget Requirements 25

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27. The Proposed Budget Step 1: Estimate Personal Services Personnel Services are budgeted by organizational unit or activity and total FTE. Current salaries/salary ranges not required to be in budget document but must be available upon request. 294.388(5) 27

28. The Proposed Budget Step 2: Estimate Materials and Services 28

29. The Proposed Budget Step 3: Capital Outlay  Undefined  Can be Allocated or Unallocated ORS 294.388(6)  Should integrate with Capital Project and Capital Expenditure Plans 29

30. The Proposed Budget Step 4: Estimate Debt Service Debt service estimates must include separate amounts for principal and interest for each bond issue in each fund. 294.388(6) Each bond issue or borrowing is identified by the issue date and exact payment date. State Department of Revenue Recommendation 30

31. The Proposed Budget Step 5: Contingency “The estimate for a fund may include an estimate for general operating contingencies.” 294.388(7) Contingency is for expenditures in operating funds that “cannot be foreseen and planned in the budget” and should be based on prior history or risk analysis. 150-29.388(7) There is no limit on how much can be budgeted as contingency, other than noted above. However, only transfers up to 15% of the fund’s total appropriations can be transferred to other appropriation line items without having to complete a supplemental budget. 31

32. The Proposed Budget Step 6: Unappropriated Ending Fund Balance 1.For beginning cash to start the next year 2.To reserve cash for multi-year construction projects or in reserve funds. 3.Cannot be spent during the year except in specified situations. 4.“Reserved for Future Expenditures” in a Reserve Fund can be spent during the year, but only for purposes for which the fund was established and after governing body action. 32

33. 33 Beginning Fund Balance + Resources - Requirements = Ending Fund Balance

34. 294.403 1.Explains budget document 2.Describes proposed financial policies for ensuing year 3.Describes important features of the budget document 4.Notes salient changes in appropriation and revenue items 5.Explains major changes in financial policies 6.Notes changes in method of accounting and the impact Prepared at direction of CEO or Presiding Officer Presented to Budget Committee with budget document @ Committee’s first meeting 34

35. Budget Document Defined:  The budget detail sheets,  Tax levy, and  Financial summary (294.311(6)) Provide to Budget Committee 35

36. Use the State Form Handout 3 36

37. Four Notification Methods Print twice in newspaper of general circulation  5 -30 days before the meeting Or once in newspaper (must include web address) and  On district website in “prominent manner”  For at least 10 days before meeting Mail to each street address, rural route or PO Box at least 10 days prior to the meeting date Hand delivery to each street address at least 10 days prior to the meeting 294.426 37

38.  At or before first Budget Committee meeting  Distribute with State’s recommendations on discussion Handout 4  When given to Budget Committee it becomes a public document and a copy must be available for the public  Means of duplication must be available to public. District may charge reasonable fee for photo copies. 38

39. 1.Call to Order 2.Elect Presiding Officer 294.414 (9) 3.Receive the Budget and Budget Message 294.426(1)(a) 4.Listen to Staff Presentations 5.Ask Questions and Deliberate 6.May Demand and Receive Information 294.428(3) 7.Hold At Least One Hearing On The Budget 294.426(1)(b) 39

40. The budget committee must have a quorum present in order to conduct business or take action.  A quorum is one more than half the number of filled positions  Action requires an affirmative vote of the majority of the total budget committee membership. 150-294.414 40

41. 8.Ask Questions and Deliberate 9.Modify the Budget 10.Approve the Budget 294.428 (1) 11.Approve Property Tax Rate &/or Amount 294.428(1) 41

42. 2013-14 Actual 2014-15 Actual 2015-16 Est Actual Line Item 2016-17 Budget FTE ProposedApprovedAdopted $$$$$$Wages 10$$$$ Budget staff completes the Approved Budget column as approved by committee. 42

43. 1.Prepare Financial Summary (LB, ED, UR-1) 294.438 2.Schedule and notice a Budget Hearing 294.438 3.Hold Public hearing to accept comments from the public. 294.453. 4.Prepare Budget Resolution to Adopt the budget. 294.456 43

44. Use State Form  General Governments (Form LB – 1)  Education Districts (Form ED – 1)  Urban Renewal Agencies (Form UR – 1).  An alternative, narrative format can also be used, but must include all the same information. 294.438(1) Handout 5 44

45. Any person may appear for or against any item in the approved budget document. 45

46. After the hearing and “consideration of matters discussed at the public hearing” (294.456(1)(a)), the governing body shall enact the budget resolution 46

47. The governing body may amend the budget estimates and tax rate or levy amount (and thus the resolution) prior to adoption, within limits. (294.456(1)(b))  Expenditures in a fund cannot be increased by more than $5,000, or 10%, whichever is greater ($10,000 or 10% in a 2 year budget)  The tax levy rate or amount approved by the budget committee cannot be increased 47

48. The Budget Resolution:  Adopts the Budget  Makes Appropriations  Declares and Categorizes Property Tax Rate or Amount. Handouts 6 and 7 48

49.  The resolution appropriations are the district’s legal authority to expend public funds… ….not the budget.  They can not lawfully be exceeded  Note that resources are not in the resolution or ordinance. 49

50. The Adopted Budget Document must have: a) The two budget committee notices b) Budget hearing notice c) Budget detail sheets d) Resolution adopting budget and making appropriations e) Resolution imposing property taxes f) Resolution categorizing the taxes g) Notice of property tax levy form (LB, ED, CC-50) h) Samples of ballots of any new property tax approved by voters, for first time levy 150-294.311 (6) 50

51. By July 15 Assessor’s Office in each county  Two copies of resolutions  The property tax certification (Form LB, ED, UR–50)  Ballot Title for any new voter-approved property taxes (Handout 8) By September 30 to the County Clerk in each county  Budget Document (In Multnomah County Budget document is filed with TSCC.) 51

52. 294.451 Should you find:  Scriveners’ Errors  Mail or delivery deficiencies  Arithmetic Errors  Miscalculation of Property Tax Levies  Missing Publishing Deadlines Inform Governing Body at its next meeting and correct 52

53. Statutes allowing changes after adoption:  294.338; exceptions to local budget law  294.463; transfers of appropriation authority  294.468; interfund loans not paid back in same year  294.471; Supplemental budget  294.473; Supplemental budget  294.343; Internal Service Funds  294.466; appropriation of pass-through revenues  294.476; newly approved Local Option Levy taxes  294.478; education district emergencies  294.481; expenditures of funds in response to emergency situation 53

54. 54 294.338 Compliance with Local Budget Law required prior to expenditure or tax certification (1) A municipal corporation may not expend money or certify to the assessor an ad valorem tax rate or estimated amount of ad valorem taxes to be imposed in any year unless the municipal corporation has complied with ORS 294.305 (Sections constituting Local Budget Law) to 294.565 (Failure to file copy of required budget, reports or other documents).

55. TSCC Staff, available anytime, anywhere TSCC web site: www.tsccmultco.comwww.tsccmultco.com DOR Local Budget Law Training sessions DOR’s annual Local Budget Law and Notice of Property Tax Forms and Instructions booklet DOR Local Budgeting Manual DOR web site: http://www.oregon.gov/DOR/programs/property/Pages/local-budget.aspx 55

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